ConocoPhillips to Slash Up to 25% of Global Workforce
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ConocoPhillips, the largest independent U.S. oil producer, plans to cut as much as a quarter of its global workforce amid lower crude prices and expectations of peaking shale output.
The majority of the oil giant’s job cuts, which are in the range of 20% to 25% of its roughly 13,000-strong workforce, will occur this year, the company said in an email Sept. 3. The downsizing, which includes both employees and contractors, was earlier reported by Reuters.
“We are always looking at how we can be more efficient with the resources we have,” Dennis Nuss, a company spokesman, wrote in an email.
ConocoPhillips dropped as much as 4.7% amid tanking prices for crude and other energy stocks.
As the U.S. shale patch matures, producers are looking to consolidation, job cuts and faster drilling to produce more oil at lower costs. Analysts and pundits have long said that U.S. shale is nearing a peak and some industry executives are beginning to acknowledge as much.
Houston-based ConocoPhillips acquired Marathon Oil Corp. last year for about $17 billion, prompting the target company to warn employees that more than 500 would lose their jobs.
ConocoPhillips expected to make $500 million in cost and capital savings in the first year of the takeover, with total synergies from the deal adding up to more than $1 billion.
In addition, the company said last month it plans to wring another $1 billion in cost cuts and margin-boosting actions and will double its asset-sales goal to $5 billion by the end of next year.
ConocoPhillips plans to hold a town hall meeting Sept. 4, according to Reuters.
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